Ready and waiting for normality
As with all periods of uncertainty, recessions and downturns, one
thing we have learnt is that when demand returns we need to be
ready and waiting, believes Windows Active editor John Cowie
These are unprecedented times as the nation is gripped in the early stages of the coronavirus. There is little doubt that we will follow the same path as other European neighbours such as Germany, France, Spain and Italy. The potential effects on business and, specifically the window industry, should not be underestimated. We will look back at this period and analyse how business could have coped better and how society dealt with the many unexpected and frightening situations it found itself in. You will learn more about your fellow citizens and their own coping mechanisms, while also gaining useful insight into how your suppliers and customers formalise strategies to help them survive this period. All concerns over Brexit have literally been thrown out of the window, as factories all over Europe and China have started to close the weakness of global supply chains that have been exposed on a massive scale.
Many business leaders are asking whether mass globalisation is under threat? Increasing numbers of manufacturers have stripped out cost and this has filtered down the supply chain. We have become accustomed to relying on ‘just-in-time’ manufacturing and have considerably reduced stock levels. This drive to reduce costs and stockholding is a feature of so many UK-based manufacturing industries. It’s not just business that is guilty of this, consumers are constantly seeking the cheapest items. The current trend for metal water bottles is a fine example. Consumers would rather pay £5.99 for one from China than pay £15 for a UK-made bottle. The coronavirus will start to challenge people’s purchasing patterns. This is perfectly illustrated by the early panic buying of toilet rolls. If people start to believe that a supply chain is faltering, they will begin to panic buy. A potential worldwide pandemic will only accentuate this situation and will challenge the very principles of globalisation.
The window industry is very resilient to supply chain issues, with many component partners double- and triple-sourcing key items. During the coming weeks and months the real concern will come in the form of consumer demand dropping off a cliff as homeowners cancel and postpone orders. We must all remember they will return and their pent-up passion to spend on their homes will have been suppressed for months but will be ready to explode. Being stuck in their homes for weeks on end staring at the same four walls will make homeowners start dreaming of glazed extensions, orangeries, vista-boosting sliding doors and getting rid of those tired windows and doors.
As with all periods of uncertainty, recessions and downturns, one thing we have learnt is that when demand returns we need to be ready and waiting. You really don’t want to be turning down business, as it is imperative that orders are processed and fulfilled rapidly. Installers and retailers will have plenty of choice, and if you can’t supply with favourable lead-times, they may go elsewhere. Marketing is also crucial over the next few months. You really want to ensure you are constantly visible to your customers even if they aren’t ordering – for when they do, you can bet your bottom dollar they will order from the companies who were shouting the loudest. Fabricators need to keep in constant contact with their supply chain, and keep a watchful eye on not just first-tier suppliers, but their suppliers’ suppliers. The biggest threat to globalisation is the rise of local markets for component supply – manufacturers need to access and examine the costs and benefits of this, and crucially, see if it is viable to pass on to customers any cost rises by sourcing from local suppliers. There is plenty to consider. Just make sure you have a strategy that helps you survive in the short term and then make the most of the opportunities of the medium and long term.